The independent committee that monitors the Insurance Brokers Code of Practice (the Code) offers key industry insights and guidance in its newly published Annual Data Report for 2020.
The Insurance Brokers Code Compliance Committee (the Committee) has released its 2020 Annual Data Report. It provides analysis of complaints and Code breach data, observations on the overall compliance of the insurance broking sector and makes recommendations on how Code subscribers can improve their compliance reporting and every day practice.
The need to focus on improving the culture and behaviour of insurance brokers emerged as a key theme, while the link between reported high breach numbers and robust compliance frameworks – and the converse of low numbers and poor frameworks – was reinforced.
The report, which supplements the Committee’s 2020–21 Annual Report and 2020 Benchmark Report, can be accessed here.
The report’s findings are drawn from analysis of self-reported Code breach and complaints data collected in the 2020 Annual Compliance Statement (ACS) and from information gathered in the subsequent verification process. This included detailed discussions with 46 subscribing insurance brokers.
These verification conferences provided an invaluable opportunity to examine the stories behind the numbers – the ‘why’ alongside the ‘what’ of subscribers’ breach and complaints reporting and compliance monitoring – affording the Committee a deeper understanding of the day-to-day workings and practical challenges facing subscribers and the wider industry.
A link between organisational culture and behaviours and good Code-compliant outcomes for everyone involved has led the Committee to expand its focus on the culture and behaviour of insurance brokers, a shift outlined in detail in its 2020-21 Annual Report. The Annual Data Report supported the need for this broader focus.
Although the overall number of Code breaches increased by 66% on the previous year, the number of Code subscribers self-reporting breaches fell to 44%, down from 51% in 2019 – meaning more than half of the Code subscribers failed to report any breaches at all, including three subscribers in the largest size category. This is concerning because it potentially signifies that large numbers of subscribers have compliance frameworks that fail to detect breaches or complaints, or a weak or non-existent self-reporting culture.
In previous years, analysis of ACS data and information gathered in subscriber surveys appeared in the Committee’s Annual Report. In 2020–21 the Annual Report contained summary data and the full analysis is published in this supplementary Annual Data Report.
Separate publication of the detailed findings gives the Committee the scope to explore the background, context and practicalities underlining breach and complaint data and related issues to deepen our understanding of practices and to provide greater insight into how Code subscribers can best respond to the consumer protections.
The Committee expects to continue this deeper exploration in future standalone Annual Data Reports.